Question details:
Question 1. Question : (TCO 1) (TCO 1) When ranking security returns from highest return to lowest return, the data shows that the annualized returns are as follows: Large stocks, small stocks, long-term corporate bonds, long-term government bonds, and treasury bills. Treasury bills, long-term government bonds, long-term corporate bonds, large stocks, small stocks Large stocks, small stocks, long-term government bonds, long-term corporate bonds, and treasury bills. Small stocks, large stocks, long-term corporate bonds, long-term government bonds, and treasury bills. Question 2. Question : (TCO 1) A direct equity claim arises through investment in __. bonds and other debt instruments common stocks, warrants, and options preferred stock and commodity futures mutual funds Comments: Question 3. Question : (TCO 1) What factors must be considered in choosing between investment alternatives? Risk and liquidity Interest or dividends versus capital gains Timeframe for managing funds and evaluating performance and tax effects All of the above Question 4. Question : (TCO 1) Which of the following is NOT a characteristic of an organized exchange? An organized exchange functions as a primary market. Securities are bought and sold in an auction market by brokers acting as agents for buyers and sellers in a central location. An organized exchange may be either national or regional. An organized exchange has a central location where all trading takes place. Question 5. Question : (TCO 1) Secondary markets provide _____. efficiency continuity competition All of the above Question 6. Question : (TCO 1) The process of selling a new issue of securities so that the price is guaranteed to the selling firm is referred to as _____. underwriting best efforts direct by issuer shelf registration Comments: Question 7. Question : (TCO 1) The first exchange to become a publicly traded company was the _____. New York Stock Exchange Chicago Board of Trade NASDAQ Stock Market Chicago Mercantile Exchange Comments: Question 8. Question : (TCO 1) The _____ is the tax rate that applies to each new dollar of income. average tax rate short-term capital gains tax rate long-term capital gains tax rate marginal tax rate Comments: Question 9. Question : (TCO 1) The index which gives equal weight to every company included, and is therefore not dominated by any single company, is the _____. Dow Jones Composite Average Standard & Poor’s 400 Index Value Line Average American Stock Exchange Index Comments: Question 10. Question : (TCO 1) The success of a short investment position depends on _____. a level stock price a declining stock market an increasing stock price declining interest rates
